Thinking About Early Retirement? Here’s What You Need to Know.
Retirement planning often focuses on a single target: age 65. But what if that’s not the only—or even the best—option? In Episode 99 of Last Paycheck, Rob and Archie Hoxton unpack five thoughtful, data-informed reasons you might want to retire early—and just as importantly, how to know if you’re ready.
1. Time Is Your Greatest Asset
Time isn’t just money—it’s freedom. Rob and Archie highlight how early retirement allows you to stop trading hours for income and start investing in what matters most: relationships, personal passions, and health. As Archie notes, “Retiring early is really about taking back your time.”
2. Your Health Has a Shelf Life
Energy wanes with age. Even healthy individuals face slower recovery times and decreased stamina. Waiting too long could mean missing out on the active retirement you envisioned—whether it’s hiking trails, traveling the world, or chasing grandchildren.
3. You May Be More Vulnerable Than You Think
Later in your career, you’re often the most expensive employee—and potentially the most expendable. In today’s volatile job market, Rob and Archie caution that planning for early retirement, even if you don’t take it, offers a security buffer in case of layoffs or corporate restructuring.
4. Your Expenses May Be More Flexible Than Expected
Healthcare is costly, but many retirees offset those expenses by cutting costs in other areas: commuting, business attire, and work-related spending. The key takeaway? Don’t assume early retirement will break your budget. Plan for it, and you may find it’s more feasible than you thought.
5. Phased Retirement Can Ease the Transition
Going from 40+ hours a week to none can be emotionally jarring. A phased approach—consulting, part-time work, volunteering—can provide structure, purpose, and even income during the transition.
But here’s the catch: early retirement doesn’t work unless you retire to something, not just from something. Without purpose, even the best-laid financial plans can leave retirees feeling aimless. That’s why planning emotionally is just as vital as planning financially.
To help you evaluate your position, we’ve created a comprehensive worksheet: “Savings by Age: Are You Where You Want to Be?” It walks you through benchmarking your retirement savings against both national averages and ideal industry targets.
Use it to:
- Measure your current savings ratio
- Benchmark against your age group
- Understand gaps and identify solutions
- Build a plan tailored to your goals